Newsle.com
Yesterday at the Cambridge Innovation Center Rich Levandov and Brady Bohrmann of Avalon Ventures discussed a few of the truths that Venture Capitalists are known to gloss over. The event was called ‘Things Venture Capitalists Say that Just Aren’t True” and the audience was full of startuppers. Now the title makes it sound like VCs are liars, but they really aren’t… they just cleverly omit certain truths. Levandov and Bohrmann discussed very candidly four main truths that VCs refrain from mentioning while navigating the minefield of entrepreneurship.
1) “If you are not having an identity crisis every few months, you are probably not challenging yourself enough.” If you are feeling lost or stressed out because something isn’t going the way you had planned, you’re on the right track. “Let’s not panic,” Bohrmann tells his companies, “these things take time.” You don’t just have a phase one followed by a phase two followed by phase three. “Plan A gets you to plan B which gets you to plan C etc. Each bumpy road is a path to the next stretch of highway.”
2) “You really need to see the difference between sincere interest and a soft no.” VCs were adamant that their jobs rely a lot on intuition, pattern recognition, and different point of views. But they also look for these traits in the people they invest in. If you didn’t pick up on those ‘soft nos,’ the next VC you pitch to might know you don’t have the ability to take a hint.
3) “People overstate the value they bring your company after the investment.” Getting a VC to invest is far from a golden ticket. VCs are there to help. They want to help. But the stories you hear about VCs are typically success stories. Truth be told, there is a real balance between success and failure. As Levandov pointed out, they do lose money. This is why the discussion began with both VCs saying ‘yes we are from Avalon and we suck less.’
4) “You have to be kind of crazy to be a CEO.” The Avalon duo had two other men in the room, both of whom were CEOs in their portfolios. Levandov had no problem pointing at Kinvey Founder/CEO Sravish Sridhar and Rob May, founder of Backupify and stating quite plainly that both of them had a little crazy in them. But it is the right kind of crazy. And VCs recognize it because they, themselves are a little crazy.
The final message Levandov wanted to clarify for entrepreneurs was this; “Entrepreneurs should never assume the VC community is unapproachable. We are in the market of good ideas…If we like it, we do it.” In any case, it was refreshing to hear VCs be so honest about how they can be so dishonest.